Section 44, The Goods and Services Tax Act, 2009

(1) In this section– (a) “scheme” includes a course of action and an agreement, arrangement, promise, plan, proposal or undertaking, whether express or implied and whether or not legally enforceable; and (b) “tax benefit” includes- (i) a reduction in the liability of a person to pay GST; (ii) an increase in the entitlement of a person to an input tax credit, including an increase in an excess carried forward; (iii) an entitlement to a refund; (iv) a postponement of liability for the payment of GST; (v) an acceleration of entitlement to a deduction for input tax; (vi) any other benefit arising because of a delay in payment of tax or an acceleration of entitlement to a deduction for input tax; (vii) anything that causes what is in substance and effect a taxable supply or import not to be a taxable supply or import; or (viii) anything that gives rise to an input tax credit entitlement for an acquisition or import that is in substance and effect an acquisition used or to be used for a purpose other than that of making taxable supplies. (2) Notwithstanding anything in this Act, if the Commissioner- General is satisfied that a scheme has been entered into or carried out and– (a) a person has obtained a tax benefit in connection with the scheme in a manner that constitutes a misuse or abuse of this Act; (b) having regard to the substance of the scheme, it would be concluded that the person or one of the persons who entered into or carried out the scheme did so for the sole or dominant purpose of enabling the person to obtain a tax benefit, the Commissioner-General may determine the liability of the person who has obtained the tax benefit as if the scheme had not been entered into or carried out. (3) For the purposes of determining a person’s liability under subsection (2), and ensuring the prevention or reduction of the tax benefit, the Commissioner-General may do any of the following:– 68 69 Negation of tax benefit from scheme. (a) treat a particular event that actually happened as not having happened; (b) treat a particular event that did not actually happen as having happened and, if appropriate, treat the event as- (i) having happened at a particular time; (ii) having involved a particular action by a particular person; (c) treat a particular event that actually happened as– (i) having happened at a time different from the time it actually happened; or (ii) having involved a particular action by a particular person (whether or not the event actually involved any action by that person). (4) If the Commissioner-General makes a determination under subsection (2), he shall notify the person of his determination either by serving a notice of the determination on the person or by issuing an assessment to the person in relation to one or more tax periods. (5) An assessment under subsection (4) shall be made to the best of his judgement based on the information available to him and such an assessment shall be made within 2 months of sufficient information being available to the Commissioner-General and no more than 6 months after the conclusion of an audit of the taxable person. (6) The Commissioner-General shall serve notice of the assessment on the recipient which shall not be more than 30 days after the date on which the notice is served and specifying– (a) the date of the assessment and the reason for the assessment; (b) the amount of GST payable or refundable as a result of the assessment; (c) the date on which that GST is due and payable; and (d) the time, place and manner in which an appeal against the assessment may be made.